You Know It's Bad When The Cayman Islands Calls For Income Taxes

As many of the world's nations grapple with how to balance their government budgets, even the tax haven of the Cayman Islands has found it necessary to look at ways to balance its own books. The Premier of the Cayman Islands, McKeeva Bush, has put forward a way to balance the government's budget; start taxing income. The Caymans, a British Territory which currently has no income taxes, announced that there will be a payroll tax of 10% on expatriates working on the islands who earn more than $20,000 (Cayman dollars) per year. Cayman residents still live income tax free. "Tax" would be too harsh a word for such a laid back island so it is being called a "Community Enhancement Fee." Perhaps Obama should try that approach here. Further, I do find it funny that a political leader with the last name "Bush" is proposing taxes (there is no relation between Cayman's Bush and the U.S.'s Bush presidential family).

In addition to taxes, Caymanian civil servants will have to pay for their health care coverage that is issued through the government-owned Cayman Islands National Insurance Company. So much for paradise. Premier Bush also said that he would be proposing an additional fee to enhance the regulatory environment of the financial industry in Cayman. With more oversight required for authorities to look for drug money, tax-dodgers from the U.S. and just plan old fraudsters looking to park their money, there is plenty of work to do.

One area of oversight that Premier Bush may wish would go away concerns the Royal Cayman Islands Police Services (RCIPS) investigation into an alleged bribery scheme. Stanley Thomas, a U.S. real estate developer who has recently fallen on hard times, of Atlanta, GA was going to build on some land in the Caymans in 2004. To do that, he needed a rezoning done and some allege that Premier Bush solicited a cash payment of $750,000 to get that accomplished. A letter surfaced recently from Bush to Thomas from 2004 in which he requested the payment for his efforts. RCIPS is investigating. It is also investigating Premier Bush on another financial matter and on his involvement in the import of explosives on to Cayman without the proper permit. Some have called on the U.S. authorities to get involved.

Corruption in British Territories is not new. In March, Interpol issued an arrest warrant for former Turks & Caicos Premier Michael Misick on corruption charges. Misick is viewed as a fugitive by British authorities. Misick is seeking political asylum in some accommodating country.